• Solana is down 3% on Wednesday, approaching its 50-day EMA at $76.67.
• SOL ETFs recorded inflows of $1.67 million on Tuesday, down from $8.36 million on Monday, signaling mild institutional demand.
• Retail demand for SOL is mixed, with fluctuating funding rates, while Open Interest dropped 4% over the last 24 hours.

Solana (SOL) price is down 3% on Wednesday, extending a bearish reversal after an overhead trendline capped the previous week’s recovery. Institutional inflows eased to $1.67 million on Tuesday, while declining Open Interest and fluctuating funding rates indicate mixed retail demand. The technical outlook for SOL indicates a bearish bias, with a risk of a decline of over 20% if price clears below the 50-day Exponential Moving Average (EMA) at $76.67.

Sellers regain strength as institutional buying eases

Solana is losing retail demand as broader market risk-off sentiment builds, while inflows into SOL-focused Exchange Traded Funds (ETFs) ease. CoinGlass data show SOL futures Open Interest (SOL) is down 4% in the last 24 hours to $5.31 billion, indicating a decline in open SOL contracts as risk-on sentiment eases among traders. At the same time, volume is down 8% to $8.66 billion, while funding rates stand at 0.0029%, up from -0.0042% the previous day, indicating near-term indecisiveness. 

On the institutional front, the SOL ETFs recorded inflows of $1.67 million on Tuesday, down from $8.36 million on Monday, signaling easing demand from institutional investors. 

Solana risks a 20% drop below its 50-day EMA

Solana is down 3% on Wednesday, extending its decline from a long-term overhead trendline, which capped the previous week's recovery around $83.94. SOL remains capped well below the 200-day EMA at $95.51, which keeps the broader tone neutral rather than outright bullish

From a technical perspective, the 50-day EMA at $76.67, reinforced by the 50% retracement at $76.92, measured over the downswing from $98.41 to $60.13, serves as the immediate support zone for Solana. A decisive close below this zone could open the path toward the lower Fibonacci anchor at $60.13, indicating a downside of around 22%.

That said, the Moving Average Convergence Divergence (MACD) is descending toward its signal line, risking a bearish crossover as buying pressure wanes, while the Relative Strength Index (RSI) dips to 54 as buyers struggle to maintain momentum.

On the topside, initial resistance emerges at the downward resistance trendline at $83.94, where a sustained upmove would open the way toward the 200-day EMA at $95.51.

(The technical analysis of this story was written with the help of an AI tool. Know more.)